An investigative committee has concluded its inquiry into the embezzlement of over 106 million rupees involving a World Bank funded project in Khyber Pakhtunkhwa, identifying three high ranking officials as responsible for the financial loss. The findings have led to the immediate removal of the project director following approval from the chief secretary, with formal disciplinary proceedings now initiated under the Efficiency and Discipline Rules. This investigation was originally triggered in late 2025 following media reports that exposed significant financial irregularities within the Khyber Pakhtunkhwa Human Capital Investment Project, prompting the Planning and Development Department to take corrective action against those managing the funds.
The detailed inquiry report exposes a startling collapse of financial safeguards and internal controls within the project administration. Investigators discovered that essential monthly reconciliations were completely ignored, and there was a total lack of oversight regarding large fund movements. Most notably, the management failed to maintain coordination with the bank despite the transfer of substantial sums of money. The investigation also highlighted a blatant disregard for standard operating procedures concerning the issuance and verification of cheques, which created a high risk environment for fraudulent activity and the eventual misuse of public resources.
According to the findings, the breach occurred when two cheque books were issued and handed over to an unauthorized individual without any verification of their identity or authority. There was no recorded evidence of identity checks during these critical transactions, enabling the unauthorized withdrawals to take place undetected. The project director was held accountable for failing to secure the cheque books and for the general absence of internal controls. Additionally, the finance management specialist was cited for failing to detect irregular transactions through regular reconciliations, while the accounts officer was found negligent in his duty to monitor financial records and verify cheque authenticity.
Given the severity of the fraud and forgery uncovered, the inquiry committee has recommended that the case be referred to the National Accountability Bureau and the Federal Investigation Agency. These anti corruption agencies are expected to launch a wider criminal investigation into the misuse of international development funds and the systemic failures that allowed such a large scale embezzlement to occur. The government aims to recover the stolen assets and set a precedent for transparency in the management of foreign aided development projects within the province.
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